Growth Insights for CEOs

Latino Marketing 101: “Niche” Rhymes with “Rich”

Posted by Jim McDonald



Latinos Made a DifferenceChief Outsider Jim McDonald talks about the influence of Latinos in marketing

Election night, as the race was called for Obama, the analysts for each network credited the Latino vote as the most nationally-decisive block. Subsequent data revealed a 70+ to 23 margin that voted with a clear preference for the platform and party that actually considered the wants and needs of Hispanics and reflected them. And like the Republicans, many brands in this country continue to either eschew or sub-optimize effective marketing aimed at the so-called “niche” of 50+ million Hispanics voting every day in America with their wallets.

Usually I have found that my clients were either ill-informed about the marketing potential of this segment (comprising 16.7% of the U.S. population), or they felt that they could get by dabbling in it or just doing just a little Spanish language advertising, even though they were superficially spending at levels far below what was commensurate with the size of the segment and the reality of the opportunity. Most clients that I have introduced to effective Hispanic marketing have had a very quick epiphany as they moved from initially testing the waters to subsequently investing aggressively and stealing market share hand over foot over lazy, condescending or less savvy competitors. Then they are delighted as they learn that Hispanic customers tend to be far more brand loyal and difficult to dislodge than general market consumers, once brand preferences are developed.

Do the Research

The key to effectively targeting and better serving these Hispanic customers? It’s as simple as applying the most classic business planning marketing discipline. It begins with doing proprietary research instead of making presumptions—research to define current perceptions of the brand and the competitive set, along with the wants and needs of Hispanics or the product/service category dynamics. A brand’s and its products’ potential for effective Hispanic marketing must also be assessed. Are the product features relevant to Hispanics? If it’s a retailer, of course there must be stores in the right neighborhoods, Spanish language capabilities among the retail associates. etc. Be wary of those who will cite lower than general market average spending by Hispanic families that often are ascending from lower socio-economic rungs on the ladder. For one client in the formal wear category, the data did show less of an amount for an average tuxedo rental. But once other facts were folded in like that Hispanics have larger sized weddings or formal events and put on far more such celebrations over time than their general market counterpoints, it was clear this group was a highly precious target indeed. Opt-in language choice needs to be implemented for these customers so that advertising, web sites, emails and such will come to the customer in the language of his or her preference—which can be a tricky matter given that Hispanics preferences in this area are driven by their degree of acculturation. Though the considerations are many, the path to success is fairly simple and direct.

Don't Make Assumptions

If you do the research from scratch without presupposing any of the general market givens or strategies, genuine understanding of the market and a competitive advantage that can be powerfully leveraged is likely to emerge. If you are lucky and the brand’s raison d’etre is based on a universal truth or appeal, brand messaging can then be tailored with distinct appeals separately to the Hispanic and general market audiences—without having to have a bifurcated brand strategy or completely divergent communication platforms for each. And then it just takes a good Hispanic agency partner that can help bring the program to life, not just linguistically but culturally, so that genuine resonance is created for the brand. I usually orchestrate a creative development shoot out among Hispanic shops I respect and my clients always get a broad array of powerful concepts to choose from. And then we turn back to the Hispanic customers and do some more research—instead of letting the well-intentioned but “gringo” clients choose the Spanish language and culture-rooted ideas that they personally are most comfortable with. 

Factor in that Spanish language media and agency services costs are usually much lower than what general market agencies charge, and that competitors are often asleep at the wheel about this enormous “niche” opportunity, and you can see why I’m so high on leading my clients to success by better serving and selling to the lucrative Latino market.

 

Jim McDonaldJim McDonald is a member of the Chief Outsiders Southwest Regional team. Contact Jim at jmcdonald@chiefoutsiders.com or on Linkedin.